Skip to main content
Financial Innovation

Table 6 Regressions after controlling for the length of financial statement

From: Tone of language, financial disclosure, and earnings management: a textual analysis of form 20-F

Variables

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

Dependent variable: EM

Positive

7.401***

       
 

(3.36)

       

Negative

 

0.432

      
  

(0.47)

      

Uncertainty

  

4.688***

     
   

(3.66)

     

Litigious

   

0.231

    
    

(0.48)

    

Strongml

    

4.826

   
     

(1.44)

   

Moderml

     

6.586**

  
      

(1.26)

  

Weakml

      

6.170***

 
       

(3.10)

 

Irrverb

       

1.732

        

(0.76)

Lnfsize

0.002

− 0.004

0.004

− 0.005*

− 0.003

− 0.002

0.002

− 0.004

 

(0.67)

(− 1.28)

(1.02)

(− 1.76)

(− 0.84)

(− 0.66)

(0.62)

(− 1.23)

Controls

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Firm

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Industry

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Year

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

N

448

448

448

448

448

448

448

448

Adj R2

0.163

0.141

0.167

0.141

0.145

0.144

0.160

1.142

F- statistics

3.72

3.29

3.81

3.29

3.36

3.34

3.66

3.30

  1. This table reports the OLS regression results after controlling for the length of financial statement (Lnfsize). The dependent variable is the earnings management (EM). The sample includes 75 U.S.-listed Chinese companies during 2002–2014.The total number of observations is 449. The sample is obtained from the S&P Capital IQ and supplemented from the Wind Database. Positive, negative, uncertain, litigious, strong modal, moderate modal, weak modal, and irregular verbs are the eight categories of wordlist defined from the 2014 Master Dictionary of McDonald and Loughran and McDonald (2011) word list. For the sake of brevity, we use Controls to represent the control variables except for Lnfsize. All regressions include firm, industry, and year fixed effects. The t-statistics are in parentheses
  2. ***, **, and* denote significance at the 1%, 5%, and 10% level, respectively
Back to article page